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Two Tiers Of Representation And Policy The Eu And The Future Of ...

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1. 1 TWO TIERS OF REPRESENTATION AND POLICY: THE EU AND THE FUTURE OF FOOTBALL Wyn Grant Department of Politics and International Studies, University of Warwick and…
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  • 1. 1 TWO TIERS OF REPRESENTATION AND POLICY: THE EU AND THE FUTURE OF FOOTBALL Wyn Grant Department of Politics and International Studies, University of Warwick and www.footballeconomy.com w.p.grant@warwick.ac.uk Paper prepared for conference of the European Union Studies Association, Montréal May 2007 for the panel on ‘The EU and the governance of football: Europeanising the game?’ I am always looking for any opportunity to improve my citation score. However, this is a work in progress so please contact me if you wish to cite the paper as I may have an updated version by then.
  • 2. 2 Abstract This paper considers the representation of football in the European Union in terms of conflicting associative state and company state models. The EU has a stated preference for dialogue with associations representing civil society, but is often susceptible to influence exerted by individual firms and big business generally. The EU’s involvement in football stems from its regulatory state form, the requirements of competition policy which apply to football as a multi-billion euro business and its search for means of establishing its legitimacy among European citizens. The paper analyses the development of the G-14 organisation that claims to represent Europe’s top clubs and compares with Uefa which emphasises principles of solidarity. There has been a battle for influence between the organization which at the moment stands as a score draw with extra time to be played with the final result uncertain. Uefa has made effective political use of the EU’s Independent Review of Football. In some respects G-14 has done less well than some other big business groups, reflecting popular interest in football. The topic raises more general issues about the response of the EU to globalisation.
  • 3. 3 In Grant (1993) I attempted to set out a framework for an ideal typical analysis of predominant forms of business-government interaction in different polities. The basic question that was posed was ‘are government-business relations mediated or unmediated. In other words, is the preferred form of business-government contact direct between firms and government, or does it take place through an intermediary?’ (Grant, 1993: 13). Countries in which direct contact was preferred, such as the United States, were characterised as company states. Where intermediation was primarily through a system of business associations, as in Germany, they were characterised as associative states. A third category, the party state, is not relevant to this discussion. In practice, of course, both company and associative forms of contact will occur. Both forms of representation will co-exist with each other. However, the relative weight that is given to more big firm oriented or more coordinated forms of representation is not just a question of process; it also has implications for values and outcomes. Big firms, or organisations confined to them, will tend to emphasise commercial values, ensuring that profitability can be maximised, for example by structuring the market in the way that suits their interests. Associations which have to consider the interests of a range of producers of different size may tend to have a more solidaristic outlook and to be more interested in the availability of public goods.
  • 4. 4 The co-existence of two tiers of representation alongside one another may give an appearance of democracy and transparency that is not wholly justified. ‘The EU political system is a wonderful place for corporate lobby groups to do business: decisions with far-reaching effects are made behind closed doors and in secretive committees, invisible to and far removed from those affected by the resulting deals.’ (Balanyá, Doherty, Hoedman, Ma’anit and Wesselius, 2000: 4). Access may in principle be available to all, but some have more privileged access than others: Clearly, multinational firms and their organizations are among the better organized and best funded in Brussels … The large firms also enjoy privileged access to many national and European policy-makers. For example, former Commission President Jacques Delors often flew on corporate jets – as the guest of chief executive officers of many European companies – on his visits to member states to promote the SEM programme. (Green Cowles, 1997: 134). These comments might seem to offer an unfair judgement on a European Commission that is publicly committed to dialogue with organised civil society: The Commission wants to consult interested parties on the widest possible basis and ensure that every interested party, irrespective of size or financial backing, should be given the opportunity of being heard by the Commission. (http://europa.eu.int/comm/civil_society/apgen_en.htm, accessed 18 April 2006) However, the significant phrase here is ‘the opportunity of being heard.’ Every conceivable interest is allowed to participate in elaborate consultative exercises on the formation of policy. They may be heard, but will they be listened to? The literature on EU lobbying tends to be either topographical (charting the various organisations or their role) or case study based, looking at a particular organisation or
  • 5. 5 a particular policy (or both). Thus, Pedler and Van Schendelen (1993) is divided into ‘company cases’, ‘trade association cases’ and ‘issue group cases’. (For another example, see Pedler, 2002). The implicit or explicit (Greenwood 2002) agenda is often about effectiveness in representational activity, i.e., how to do it, how it was done and how not to do it. The case study approach distracts our attention from broader issues about power and how it is distributed. Why should the EU have a bias in favour of big business? For all the emphasis on its social and environmental policies, the EU is essentially an economic organisation organised around a single market and currency. Among its central objectives are ensuring that the European economy continues to grow as a mechanism for reducing unemployment which remains unacceptably high in many parts of the EU. It also wants to maintain the competitiveness of European industry and strengthen its research base to ensure that it can compete with both the United States and rising economic powers such as India and China. But such a strategy requires the active co-operation of business if it is to be successful. This is not to argue that business is dominant, although it has won some important battles, e.g., the establishment of the single market, blocking a carbon tax and diluting the REACH reform of chemicals legislation. If one wants an example for football, then the framework for the Premiership’s media contract was eventually agreed with the Commission that was far less threatening to its earning potential than earlier proposals, a conclusion reached after top level negotiations between the responsible Commissioner, who was reportedly ‘leant on’ by Gordon Brown and Jack Straw, and Premiership chief executive Richard Scudamore. Of course, other values than those of business have to be considered which is why there is a project for a ‘social Europe’. European politicians are predominantly
  • 6. 6 Social or Christian democrat rather than neo-liberal. Environmental groups can appeal to wider public values. The EU attempts to redress the resources balance by providing financial aid to non-governmental organisations. Nevertheless, no one should doubt the central place occupied by business in the European project. What has all this got to do with football? Why should the EU be interested in football at all? There are many within the ‘world of football’ that see its interventions as unwarranted and unwelcome interference. As one Premiership chairman put it: The European Commission continues to involve itself in the affairs of the FA Premier League in a very public and high profile manner. …. It cannot be right that the Commission should seek to challenge our right to enter into genuine commercial agreements for the sale of our broadcast rights because they do not like the outcome. We must use every means at our disposal to protect the game in this country from such outside interference. (Murray, 2005: 5). This view represents a widespread one that football should largely left to regulate itself which is what has effectively happened in the member states. Football represents an example of a well embedded policy community that maintains substantial defences against ‘outsiders’. Equivalent regulatory failures in other spheres of life have attracted government intervention, but football has been able to maintain its autonomy. (Moran, 2005). It is therefore understandable that there are those in football who want to replicate what they see as a satisfactory arrangement on the national level at the EU level. Minimalists thus ‘seek the strongest possible protection from EU while maintaining the greatest possible distance from the EU.’ (Parrish, 2003: 250). This might seem to be an attractive strategy, particularly when it can be linked with broader anti-EU narratives in countries such as Britain. The
  • 7. 7 difficulty it encounters is the changing nature of a football. Football has become more of a business, but it has also be incorporated into agendas promoting health and social inclusion and this tension between the economic and the social cannot always be glossed over by public relations initiatives. In any case, as far as the European Commission is concerned, football as a multi- billon euro business activity cannot be exempted from the competition rules designed to deal with abuses of a dominant position or the formation of cartels. ‘In economic terms, between 3-4% of the European Union’s annual GDP is generated through sports and sports in general have an average annual growth rate of 4%.’ (European Parliament, 2006: 8). Notwithstanding the popularity of, for example, cycling and rugby in some member states, football is the leading sport in terms of economic impact. State aid issues may also arise because public authorities may get involved in financing football, particularly helping to fund the building of stadiums. Thus, one motive to get involved is simply the discharge of the duties given to the Commission under the treaties. This perspective is consistent with what Parrish (2003: 250) identifies as a single market advocacy coalition that ‘has observed the commercialization of sport and sees much sporting activity as economically based and as such subject to the laws of the Single Market.’ Because the EU lacks the fiscal powers available to other political entities, and much of what it does have to spend is devoted to the Common Agricultural Policy (CAP), the EU has developed as a ‘regulatory state’. (Majone, 1996). Thus, ‘Embedded within the EU’s constitutional and normative structure is a predisposition for the promulgation and enforcement of rules.’ (Parrish, 2003: 246). At a very general level, the EU is tempted to regulate sport because that is what the EU does. One version of the socio-cultural advocacy coalition identified by Parrish is those who
  • 8. 8 support a fully fledged sports policy embodied in a treaty provision. (Parrish, 2003: 250). In the interim, the resort may be to soft law as exemplified by the Nice Declaration on Sport (Parrish, 2003). The application of competition policy rules and the regulatory imperative, stimulated to some extent by spillovers, are important explanations of the EU’s involvement in football. However, there is one other important consideration and that relates to the legitimacy of the European Union. The difficulty arises from the contrasting bases of legitimacy represented by a European demos on the one hand and a sharing of the rights of states through treaty agreement on the other (Gamble. 2006). One has a complex polity that is more than an international organisation and less than a state and which lacks an adequate descriptive language that is communicable to the ordinary European citizen. Hence, the EU has always been interested in projects that relate to the lives and concerns of European citizens, hopefully conferring an output legitimacy that in time will become more deeply rooted. A good example is environmental policy. Europeans are concerned (or say they are concerned) about the state of the environment; many environmental problems are trans-boundary in character; and the EU can strike a moral stance on the world stage on issues such as climate change that differentiates itself from the United States. So if the EU can deliver cleaner rivers and air, and more biodiversity, it may seem less remote, bureaucratic and technocratic to Europeans. Could not football perform a similar function? It appeals to the rich and to the poor, to the old and the young and to many different ethnic groups in Europe’s diverse society. Its only deficiency from the viewpoint of social inclusion is that the composition of support still has a gender bias. What better way to demonstrate the
  • 9. 9 relevance of the EU than to take measures that are seen as fan friendly? However, one problem is that football is organised on a national basis with competition taking place in national leagues and cups and between teams representing countries, often reinforcing popular stereotypes that member states have of each other. The one exception is the Champions League (and, on a smaller scale, the Uefa Cup). This pits clubs from across Europe against each other, thus potentially creating a European framework of reference. From time to time, the project of a ‘super Champions League’ or European league is mooted. It is perhaps no accident that the G-14 grouping of top European clubs was formed after Media Partners, an Italian media company, offered to form a breakaway European league in the 1999-2000 season. Recently, the idea of such a league was mooted again, provoking fierce denials of any involvement by G-14. No Commission official has ever expressed a view in favour of a breakaway league, but would it help to create a European sporting space as part of a larger European public space, erode national identities, give citizens a more European frame of reference and hence promote an integrationist project? However, a league without promotion and relegation and traditional local rivalries might not appeal to fans and could be a commercial failure. Threats of a breakaway are largely a negotiating ploy by bigger clubs acting individually or are talked up be media interests. G-14: the voice of football as a business G-14 represents eighteen of the largest football clubs in Europe (although not Chelsea). It unabashedly proclaims a commercial and club oriented, as distinct from an associative view of football, and wants to increase the influence of the big clubs in the game. It is concerned that within Uefa, while the five big federations may stand up for their clubs, they will be outvoted by the forty-seven smaller federations, given
  • 10. 10 that each association has one vote. Its view is that ‘football clubs have become “football companies”, whose daily activity also relies on abilities outside of sport.’ (http://www.g14com/G14ourmission/actions2.asp, accessed 18 April 2006). It is clear that ‘G-14 clubs are businesses and operate in the same competitive market environment as any other business.’ (European Voice, 4-10 December 2003: 25). There is no claim for autonomy for football from political forces. ‘G-14 welcomes EU involvement in issues impacting on football as a business.’ (European Voice, 4- 10 December 2003: 25). Transparent and consistent regulatory frameworks are seen as a means of boosting legal certainty for clubs and hence business confidence. Banks (2002: 13) has argued that ‘G14’s influence has been overstated’. His argument rests on the limited size of the organisation’s membership and the difficulty it has in reaching consensus on important issues. G-14 started with an informal grouping of eight clubs that had won at least five European titles. However, as it was converted to a formal status, these standards had to be relaxed, as G-14’s general manager, Thomas Kurth admitted: It was decided that it was not possible to leave out Manchester United because, even though they hadn’t won as many titles, they were No 1 in terms of business and fan base. It was also decided that France ought to be represented and, since Marseilles had just won the European Cup, they joined. But then Paris Saint- Germain joined too, since, after all, they’re from the capital of France and, at the time, they were owned by Canal Plus, which is a big media player. At that point Bayern insisted that Borussia Dortmund come in, because Germany needed to have as many members as France. And then Real Madrid brought in their friends from FC Porto, and Ajax their friends from PSV Eindhoven and so on .. (Quoted in Marcotti, 2004: 20).
  • 11. 11 In the face of some resistance from Barcelona and Marseilles who were underperforming in their national leagues and didn’t want the status conferred on them by G-14 membership to be undermined (Banks, 2002: 131) four new clubs were admitted in 2002: Arsenal, Bayer Leverkusen, Olympique Lyonnais and Spain’s Valencia. Bayer Leverkusen has never won a league title and Lyons only won their first French title in 2002. Meanwhile, AS Roma, Benfica and Chelsea were left out, although Kurth’s argument was that the first two of these clubs ‘were blackballed for having outstanding debts to other G14 members’. (Quoted in Marcotti, 2004: 20). The argument in relation to Chelsea seemed to be that they are a new star in the firmament that ‘need to prove as solid as they pretend to be.’ (Marcotti, 2004: 20- 21). New members need unanimous agreement and it has been suggested that Arsenal is one of the clubs that have blackballed them in the past. One factor may be that the Chelsea chief executive, Peter Kenyon, is chairman of the European Club Forum, a body set up Uefa in 2002 to try to tempt the powerful clubs back into its camp. Interestingly, Uefa claims that membership of this forum is ‘based on objective, democratic, sporting, transparent, non-elitist criteria.’ However, its composition does not seem that different from G-14 as it is based on ‘those clubs participating most frequently in the European club competitions’. (Uefa, 2005: 23). The difference is that all 52 member federations are represented. In 2004 there was speculation that Celtic and Rangers might be invited to join G- 14, but one question that arose was whether further expansion would dilute rather than strengthen G-14. Moreover, ‘It does appear as if the G14’s priority was ensuring that each of Europe’s five biggest leagues would have three (and only three) representatives.’ (Marcotti, 2004: 20). (The balance of the membership is made up by two Dutch and one Portuguese clubs). The persistence of a national frame of
  • 12. 12 reference is also reflected in the composition of the management committee in 2006 which had one representative from each of four major countries (England, Germany, Italy, Spain), plus one from Portugal. In 2007 the committee was expanded by one member which permitted French representation. Unlike an organisation say, of, volume European motor manufacturers who usually produce in more than one EU member state it is not clear who should be a member and who should be excluded. Nevertheless, it does represent ‘about 50 per cent of the market in European player transfers.’ (Financial Times, 16 May 2002). G-14 has also tried to broaden its base of support by establishing an annual international club conference that includes senior club executives from outside the grouping. G-14 has a curious voting structure that awards votes on the basis of success in European club competitions. Winning the Champions League and its predecessor competition gets you two votes, while
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